The trade war between Trump and China is still an issue that keeps investors and the tech industry on pins and needles. The negotiations between Mr. Trump and the Chinese hit a roadblock recently when the president had to ask chief U.S. trade negotiator Bob Lighthizer what memorandums of understandings have to do with trade deals.
Trump didn’t realize MOM’s are contracts of agreement during trade deals. The president didn’t like the word memorandums, so Lighthizer and the Chinese changed the term to “contract.” That silly move made the head Chinese official laugh. And that is just one of the Trump issues that make the Chinese wonder how the real estate developer got to be president.
Trade experts say the Chinese are master negotiators. They will give in order to get something in trade deals as long as there are benefits in the giving. But according to Daily Mail, the Chinese won’t budge on the intellectual property piece of the deal unless the U.S. releases Huawei CFO Meng Wanzhou. Wanzhou is also the daughter of Huawei’s founder.
The Canadians arrested Meng in Vancouver three months ago at the request of the U.S. government. The U.S. claims Huawei violated Iranian sanctions by selling tech products to companies who still do business with Iran. But the Chinese know Trump put a bug in the ear of Department of Justice officials so Canada would arrest Meng. That move threw Canada into an international trade war that won’t end well for Canada, according to the Chinese. China arrested two Canadians right after Meng’s arrest.
The Canadians agreed to extradite Meng recently. That move only exacerbated the tech circus between Trump and China. If the U.S. courts say Wanzhou is guilty, the tech industry is in for a rough ride with Huawei, the largest supplier of smartphone parts in the world.
Huawei and the Chinese government have a close relationship. All Chinese companies who do business with other countries share information with the government. The U.S. calls that information sharing, spying.
Some Washington insiders say the tech part of the trade deal is the holdup. China will lower tariffs on American made vehicles. And China will buy more products from the United States. But what they won’t do is let Meng Wanzhou suffer because Trump wants to tie Huawei business hands in the United States.
Trump may extend the deadline for increasing the tariff percentage on Chinese products. Because the main issue he needs to resolve is what he will do when Meng arrives in the U.S. to face what the Chinese call phony charges.
Dil Bole Oberoi
